SparkLabs Global Ventures’ Technology and Internet

Market Monthly Review

January 12th, 2018

Monthly Highlights

Global Trends
• Global Downward Trend for Early-Stage Venture Capital?
“Crunchbase News’s report for Q4 finds that global venture activity snapped a year-long growth spurt, with
declines led by seed and early-stage deals across certain key metrics. Although deal and dollar volume are
up compared to the same time period last year, Q4 brought the first quarterly declines in a year.

This is a small but mighty asset class. Although seed and angel-stage deals accounted for just 4.4 percent of
total dollar volume in Q4 2017, they represented 58.5 percent of the total deal volume.

When comparing Q4’s performance to Q3, angel and seed-stage deals also are the only bright spot in the
global venture funding ecosystem. Dollar volume into seed and angel-stage deals present one of the few
bright spots in early funding activity with quarterly growth of 11.3 percent. For all other stages, dollar volume
was down on a quarterly basis. Compared to Q4 2016, projected dollar volume is up roughly 17.5 percent.”
(more from TechCrunch, Did the tide of global VC start to turn in Q4 2017?)

Asia Pacific
China
• Huawei’s new whole-home Wi-Fi system combines Powerline and mesh networking
Huawei launched a new home Wi-Fi system, the WiFi Q2. Along with their Wi-Fi mesh network, they have
integrated a Powerline network which utilizes existing electrical systems. This combined system at full speed
can reach 1867 Mbps (more from TechCrunch).
• Baidu debuts Apollo 2.0, its latest open self-driving platform
SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in
Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul.
1
 SparkLabs Global Ventures’ Technology and Internet
Market Monthly Review

January 12th, 2018

Baidu announced a major update at CES 2018 last week to their Apollo autonomous driving platform. This
covered support for new reference vehicles, new computing platforms, more mapping services and other
updates. The company announced a number of new partners such as Nvidia, Intel, NXP and Renesas (more
from TechCrunch).
• Baidu partners SG’s Asia Mobility Industries to launch $200m venture fund
Baidu and AMI (Asia Mobility Industries) will launch a $200 million venture capital fund, Apollo Southeast Asia.
The fund’s purposes is to help grow the ecosystem around Baidu’s open-source autonomous driving platform
Apollo. The two companies are forming a joint venture (JV) to target investments in advanced mobility projects,
research, technology exchange, and the commercialization of Baidu’s autonomous driving technologies in SE
Asia (more from Deal Street Asia).
• Google eyes Chinese e-sports market with investment in Chushou
Google invested in Chushou, a live-streaming mobile gaming platform in China, as part of the company’s
$120M round. The company was founded in 2015 is an online e-sports platform for mobile phones with 8
million streamers and 250,000 live streams a day (more from Reuters).
• U.S. blocks MoneyGram sale to China's Ant Financial on national security concerns
Ant Financial’s plan to acquire MoneyGram (MGI.O) was rejected a U.S. government panel which stated
national security concerns. This was the the most high-profile Chinese deal that has been blocked under the
Trump administration. The blocking of this $1.2 billion deal is a big setback for Jack Ma, the Chairman of
Alibaba Group Holding Ltd (BABA.N), who owns Ant Financial (more from Reuters).
• Hello Bike Raises $153 Million More from Fosun Group and GGV Capital
This adds to Hello Bike’s $350 million it raised in December 2017. This positions Hello Bike as a strong
contender versus Mobike and Ofo, who are the leading bike sharing companies in China. The company has
750,000 app users versus Ofo’s 5.1 million and Mobike’s 4.9 million (more from Tech in Asia).
• Xiaomi To Beat 2017 Revenue Target, Post $1B Profits
Xiaomi supposedly estimated its annual revenue to be between $17 and $18 billion, so some people close with
the company believe this translate to $1 billion in net profit. This is surprising since most hardware
manufacturers have thin margins (more from Android Headlines)
• Chinese ride-hailing giant Didi Chuxing raises $4 billion
Didi Chuxing raised $4 billion from unnamed institutions. The total funding now stands at $19.7 billion. The
company stated that with the new capital it will further focus on its artificial intelligence investments, global
expansion, and other initiatives, such as “new energy vehicle service networks” (more from VentureBeat).
• Tencent is bringing China's biggest game to the rest of the world
Honor of Kings has an estimated 200 million monthly players, and was launched in the U.S. and Europe under
the name, Arena of Valor. Tencent launched this mobile strategy game in 2015, and now has its eyes set on
outside of China. The game is so popular in China that Tencent made restrictions to keep children under 12
years old from playing more than an hour a day (more from The Verge).

Japan
• Nintendo Switch has now sold 10 million units globally
Nintendo has sold 10 million Switch game consoles across the world, which is amazingly only have 10 months
of its debut. The company reported net sales $3.29 billion for the first six months, and compared to last year’s
$1.2 billion (more from VentureBeat).
• Japanese retail investors are major force in Bitcoin boom
“Japan’s army of retail investors, no strangers to high risk bets in the past, have emerged as a major force in
bitcoin’s spectacular rally, now accounting for an estimated 30-50 percent of trading in the cryptocurrency as it
spikes to record highs. Once skeptics, Japanese retail investors have been attracted by the digital currency’s

SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in

Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul.
2
 SparkLabs Global Ventures’ Technology and Internet
Market Monthly Review

January 12th, 2018

volatility and inefficiencies in pricing that create opportunities to make money on arbitrage between
exchanges.” (more from VentureBeat)
• Line funds Mobike to put bike-sharing in messaging app
Mobike, the Chinese bike-share startup, received an investment from Line (subsidiary of South Korea’s Naver
Corporation), maker of the leading messaging app in Japan (71 million users). Line has taken a 20 percent
stake in Mobike’s Japan subsidiary for an undisclosed sum (more from Tech in Asia).
• SoftBank acquires a 20 percent stake in Uber
SoftBank Group completed its purchase of 20 percent in Uber. Uber’s value drops approximately 30 percent
from $70 billion to $48 billion. Most say this lowered valuation reflects the trouble that Uber has gone through
this past year with Travis Kalanick resigning early in 2017 (more from The Verge).

South Korea
• SendBird raises another $16M led by Shasta Ventures and August Capital
SendBird raised $16 million led by Shasta Ventures and August Capital with Y Combinator and Funders’ Club
following on. The company gives developers tools to easily roll out chat functions for various websites.
While the core version of SendBird is able to handle most use cases for organizations looking for chat, but
they have expanded to other functions and tool sets (more from TechCrunch).
• LG unveils new concept robots for carrying your drinks, suitcase, and shopping
LG announced a trio of new robots at CES in Las Vegas. The robots are designed to assist people in carrying
stuff — from drinks to suitcases to shopping. An example of LG’s airport guide robot (more from The Verge):

(Image Credit: LG)

• Samsung announces 3 new C-Lab projects, including smart glasses for visually impaired
Samsung presented an early preview of three new projects from their in-house incubator program… “Recently,
Samsung launched Relúmĭno, an app that works in conjunction with the Samsung Gear VR headset to help
the visually impaired see more clearly. The rear camera on the smartphone serves as the “eyes” of the Gear
VR, with the app magnifying specific areas of the real world — from books to artwork — while adjusting color
contrast and brightness to make the object easier to see… Samsung also announced S-Ray (Sound-Ray),
which is a directional speaker designed with portability in mind… GoBreath, which it touts as a ‘recovery

SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in

Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul.
3
 SparkLabs Global Ventures’ Technology and Internet
Market Monthly Review

January 12th, 2018

solution’ for those who have suffered from lung damage or postoperative pulmonary complications.” (more
from VentureBeat)

United States
• AlphaGo Teach coaches people to play Go like Google DeepMind’s AI
Google’s DeepMind subsidiary released AlphaGo Teach, which is a tool to help people learn to play Go like
AlphaGo. This is an interactive tool where people can see how AlphaGo reacts to different lines of plays and
related odds when using black stones (more from VentureBeat).
• Fraud detection startup Simility raises $17.5 million from Accel, PayPal
Simility raised $17.5 million led by Accel along with PayPal and existing investors Trinity Ventures and The
Valley Fund. The company uses machine learning to improve fraud detection’s collection and analysis of
data. Simility targets SMBs to enterprise companies looking to deal with online fraud (more from
VentureBeat).
• Shervin Pishevar Steps Aside At Sherpa, Hyperloop Amid Sexual Harassment Allegations
“Shervin Pishevar, the prominent Silicon Valley venture capitalist and early Uber investor, is taking a leave of
absence from both Sherpa Capital and Virgin Hyperloop One just days after accusations of sexual harassment
and unwelcome advances from multiple women surfaced in a report from Bloomberg. Forbes also reported in
November that Pishevar had been arrested in May after being accused of rape in London. He strongly denied
the allegations and was never charged. Last month, Pishevar filed suit against Definers Public Affairs,
accusing the public relations firm of working quietly to spread damaging and defamatory misinformation about
him.” (more from Forbes)
• Indiegogo starts listing initial coin offerings
Indiegogo announced that they will be listing a select number of ICOs (initial coin offerings), which moves
beyond perk-based crowdfunding… “While ICOs will be listed on Indiegogo, interested backers will have to go
to a portal called First Democracy VC to invest. First Democracy VC is an SEC-registered equity crowdfunding
portal that was developed through a partnership between Indiegogo and equity crowdfunding site
MicroVentures. Indiegogo first partnered with MicroVentures last year to host equity crowdfunding campaigns
that comply with the regulations established through the 2012 JOBS Act. According to an Indiegogo blog post,
30 companies raised $7.53 million during First Democracy VC’s first year of existence. The first ICO listed on
First Democracy VC is a presale for Fan-Controlled Football League, which, as the name suggests, wants to
create professional sporting leagues where decisions are made entirely by fans. Formerly called Fanchise, the
company previously raised more than $63,000 through an Indiegogo campaign.” (more from VentureBeat)
• Google Brain cofounder Andrew Ng unveils Landing.ai to bring intelligence to manufacturing
Andrew Ng, Co-founder of the Google Brain project and former head of Baidu’s AI group, has launched
Landing.ai. The company will seek to help companies in the manufacturing sector to become more AI driven.
Landing.ai will provide educational materials and software to key employees and executives to integrate AI
into their companies (more from VentureBeat).
• Y Combinator announces growth program for later stage startups
Y Combinator (YC) has launched a growth program for later stage startups… “The program, which will be a
10-week dinner series, is designed for founders of post-series A startups who have between 50 and 100
employees. Over the past decade, YC has become a pivotal player in the startup scene, funding seed-stage
startups through its biannual batch program, which offers founders three months of mentoring, as well as
$120,000 for a 7 percent equity stake. Notable graduates include Airbnb, Dropbox, Instacart, Reddit, and
Stripe.” (more from VentureBeat)
• Bio-programming toolkit maker Asimov launches with $4.7M from Andreessen Horowitz
Asimov closed $4.7 million seed round from Andreessen Horowitz. The company was spun off from MIT and
a team of researchers there. Asimov has created a set of computer-aided biology design tools… “The
problem that Asimov addresses is this. Say you’re a pharmaceutical company trying to make a tiny
SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in
Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul.
4
 SparkLabs Global Ventures’ Technology and Internet
Market Monthly Review

January 12th, 2018

biocompatible machine that holds a certain amount of medication and releases it when it senses some other
molecule. In order to do so, you’d have to — well, among about a million other things — design what amounts
to a logic gate and signal processor that works at the molecular scale. This is a daunting prospect, as creating
molecular machinery is a labor-intensive process often involving creating thousands of variations of a given
structure and testing them repeatedly to see which works.” (more from TechCrunch)
• Lemonade raises $120 million from SoftBank to take its chatbot-based insurance service global
Lemonade raised $120 million from Softbank and existing investors such as GV (Google Ventures), Sequoia
Capital, and Allianz. The company is a fully licensed insurance carrier that underwrites its own policies. Their
product is mobile-first and driven by AI chatbots (more from VentureBeat).
• Overstock’s CEO launches new trading platform and token, tZero
“Few mainstream business leaders have taken to the blockchain quite like Patrick Byrne. The founder of
Overstock.com has been accepting Bitcoin since 2014 and has been talking about disrupting the payments
world with transparent, low-cost, and sane blockchain-based systems. With tZero, he just started his roll
toward full blockchain adoption. TZero, at its core, is a SEC-regulated alternative trading system (ATS).
Rather than depending on broker dealers to buy and sell securities, tZero works, in theory, like money sender
Transferwise by matching buyers and sellers in a dark pool. The goal is to create an alternative to the
NASDAQ with a ledger that is open, transparent, and immutable… Byrne said the company was also
launching a token sale to help seed the platform.” (more from TechCrunch)
• Eric Schmidt is stepping down as executive chairman of Alphabet
Eric Schmidt is stepping down as executive chairman of Alphabet. He was Google’s CEO from 2001 to 2011,
and remained as chairman of Google, now Alphabet, since 2001. The primary change is Schmidt will be
leaving his day-to-day responsibilities of heading Alphabet’s board (more from Recode).
• Amazon acquires connected camera and doorbell startup Blink
Amazon acquired Blink, which is a Wi-Fi home security camera startup. The company was founded in 2014
and raised over $1 million through its crowdfunding campaign. Amazon entered the home security business
with its Cloud Cam and Amazon Key offerings, so Blink helps round out its product line (more from
TechCrunch).
• Apple apologizes for iPhone slowdown drama, will offer $29 battery replacements for a year
Apple published a letter to customers for their admission to slowing down older iPhones, which many
suspected they did to drive sales to newer iPhones. The company’s apology letter explained “slowing down
older phones in order to compensate for degrading batteries” and is offering people with an iPhone 6 or later a
battery replacement. This battery costs $29 (more from The Verge).
• “OH MY GOD, THIS IS SO F---ED UP”: INSIDE SILICON VALLEY’S SECRETIVE, ORGIASTIC DARK SIDE
“Some of the most powerful men in Silicon Valley are regulars at exclusive, drug-fueled, sex-laced parties—
gatherings they describe not as scandalous, or even secret, but as a bold, unconventional lifestyle choice. Yet,
while the guys get laid, the women get screwed. In an adaptation from her new book, Brotopia, Emily Chang
exposes the tired and toxic dynamic at play.” (more from Vanity Fair)
• Microsoft to acquire hybrid cloud storage company Avere Systemsg
Microsoft has acquired Avere Systems, a hybrid cloud data storage company. The company was founded in
2008 seeking to help corporates use public cloud with on-premises data storage. Avere Systems is based in
Pittsburgh, and the terms of the acquisition were not disclosed. The company raised $86 million including $14
million last year from Google and other investors. They include Amazon Web Services (AWS) and Google’s
Cloud Platform as partners, but was allied with Microsoft (more from TechCrunch).
• WP Engine, a managed WordPress platform, raises $250M from Silver Lake
WP Engine raised a $250 million round led by Silver Lake. The use of uses will focus on international
expansion. We assume the current valuation of the company is at least post-money $444 million. The
company states its revenues are more than $100 million in annual recurring revenue. WP Engine has more
than 75,000 customers. The company states that its platform powers approximately five percent of all internet
visits (more than TechCrunch).

SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in

Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul.
5
 SparkLabs Global Ventures’ Technology and Internet
Market Monthly Review

January 12th, 2018

• Every Overwatch League game will be streamed on Twitch for the next two years
Twitch secured a two-year deal to stream every single game of the Overwatch League’s first two seasons
besides the China market. These games will be broadcast in English, Korean and French. Fans can use
Twitch’s virtual currency, Cheering, with exclusive Overwatch League Cheermotes. “Our fans love to engage
with content on Twitch, and we wanted to drive significant viewership of the Overwatch League in its inaugural
season and beyond,” said Armin Zerza, chief operating officer of Blizzard Entertainment, in a statement (more
from TechCrunch).

Europe
• European mobile payments company iZettle raises $47 million
iZettle, a mobile payment company, raised $47 million (€40 million) from Dawn Capital and The Fourth
Swedish National Pension Fund. The company has been called the “Square of Europe,” which was founded in
2010 in Stockholm. The company’s total funding stands at $150 million through a mix of debt and equity
financing. iZettle provides a mobile device bank card reader and an app that allows merchants to accept credit
card payments (more than VentureBeat).
• Estonia planning its own cryptocurrency, called ‘estcoin’, in bid to become global ICO hub
Estonia revealed the country’s plans for its own cryptocurrency, estcoin. The tokens, which technically are not
currency because this would violate Estonia’s agreement to use euro as its official currency, may go on sale in
2018 to raise money for the country’s e-residency program. Estonia is seeking to put in place a clearer
regulatory framework which would be more welcoming for ICOs and put aside any questions around its
regulations and legality (more from VentureBeat).
• Tandem’s acquisition of Harrods Bank, the banking arm of UK department store, is approved by
regulators
Last August 2017, Tandem, a “challenger bank”, signed an agreement to acquire Harrods Bank. Harrods
bank is the banking arm of the U.K.’s most famous luxury department store. The deal was subject to
regulatory approval, and now they have received approval from the Prudential Regulation Authority and the
Financial Conduct Authority. Now Tandem will soon receive a full banking license while gaining 10,000
Harrods bank customers (more from TechCrunch).
• Spotify sued for $1.6 billion over Tom Petty, Doors songs
Wixen Music Publishing is suing Spotify with a $1.6 billion dollar lawsuit. The company accused Spotify of
using artists' music "without a license and without compensation”. Wixen is responsible for copyright
management and royalty compliance for many artists, such as Tom Petty, The Doors, and Neil Young. More
than 10,000 songs are listed in the lawsuit with Wixen is seeking damages of $150,000 per song (more from
CNN).
• Exclusive: Spotify files for its IPO
“Music streaming giant Spotify confidentially filed IPO documents with the SEC at the end of December, Axios
has learned from multiple sources. Why it matters: Spotify is pursuing a direct listing instead of a traditional
float, causing both Silicon Valley and Wall Street to pay very close attention. If successful, it could change how
some tech companies go public. Show less The direct listing means no road show or other typical IPO
accoutrements — including some of the Wall Street fees, although several investments banks are involved.
The quiet period does seem intact, however, as a Spotify spox declined comment.” (more from Axios)
• Coinify raises $4.8 million to bring cryptocurrencies to retailers
Coinify, a Denmark-based startup, raised $4.8 million from Nordic Eye and included SEED Capital and SEB
Ventures. The company seeks to allow cryptocurrencies at various retailers, and they already have more than
60,000 merchants in Europe. In 2017, Coinify’s revenues grew 1,600 percent, and they want provide cash
withdrawal services too (more from VentureBeat).

SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in

Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul.
6
 SparkLabs Global Ventures’ Technology and Internet
Market Monthly Review

January 12th, 2018

Taiwan
• Facebook opens its social VR Spaces platform to HTC Vive
Facebook announced that Facebook Spaces would run on the competing HTC Vive headset. This opens up
their platform to a greater audience… “Users on both the Oculus and HTC headsets will be able to meet up in
the cross-platform app, where they can chat, watch videos, draw, play games and go on virtual trips.” (more
from TechCrunch)

Australia
• WePower takes its blockchain-powered green energy platform to Australia
“WePower is an energy trading platform that aims to finance the development of green energy projects and
inject additional renewable power into the grid. While initially focused on Europe, WePower has announced
that it will expand operations into Australia via acceptance into StartupBootcamp… WePower raised $3 million
from its pre-ICO in October, with an ICO coming in February 2018, and the platform is expected to launch in
March 2018. The company secured its first client in July 2017 — a 1000Mw solar project — and produced a
minimum viable product in August of this year.” (more from VentureBeat).
• New Sequoia China investment values Australian design company Canva at $1 billion
Canva, the online graphic design service, closed a $40 million round led by Sequoia China. The company hit
profitability in 2017 and secured 294,000 paying customers. Blackbird Ventures and Felicis Ventures, earlier
investors, also joined the round (more from TechCrunch).

Israel
• Bizzabo, a platform for event organizers, raises $15 million led by Pilot Growth Equity
Bizzabo, a platform for event organizers, raised $15 million led by Pilot Growth Equity. The company offers a
range of tools for event registration, ticketing, networking, surveying, marketing, and more. Bizzabo raised
$14.5 million in their prior round (more from VentureBeat).
• Lab-made meat startup SuperMeat raises $3M seed to develop ‘clean’ chicken
SuperMeat, based in Tel Aviv, raised $3M in seed funding with backing from New Crop Capital, Stray Dog
Capital (questionable name), and PHW, a large European poultry producer. This food tech startup is
developing a new lab-made chicken meat. The CEO and Co-founder, Ido Savir, has been an ethical vegan for
20 years (more from TechCrunch).

Latin America
• Didi Chuxing buys control of 99, Brazil’s leading ride-hail app
Didi Chuxing acquired a controlling stake in 99, a leading ride-sharing app in Brazil. The deal valued 99 at $1
billion. Over a year ago, Didi invested $100 million into the company (more from The Verge).

MENA
• Telegram plans multi-billion dollar ICO for chat cryptocurrency
“Encrypted messaging startup Telegram plans to launch its own blockchain platform and native
cryptocurrency, powering payments on its chat app and beyond. According to multiple sources which have
spoken to TechCrunch, the ‘Telegram Open Network’ (TON) will be a new, ‘third generation’ blockchain with
superior capabilities, after Bitcoin and, later, Ethereum paved the way. The launch will be funded with an
enormous Initial Coin Offering, with forthcoming private pre-sales ranging into the hundreds of millions,
potentially making it one of the largest ICOs to date. Demand is driven by the fact that rather than the ICO

SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in

Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul.
7
 SparkLabs Global Ventures’ Technology and Internet
Market Monthly Review

January 12th, 2018

coming from a fresh startup, Telegram is a well-established messaging platform used around the world.” (more
from TechCrunch).

SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in

Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul.
8